EuroDry reports results for three and six month period ended 30 June 2018

EuroDry Ltd., an owner and operator of dry bulk vessels and provider of seaborne transportation for dry bulk cargoes, announced its results for the three and six month period ended 30 June 2018.

Euroseas Ltd. (former parent company) contributed to the company its drybulk fleet of six vessels, one ultramax and two kamsarmax vessels built between 2016 and 2018, and three Japanese-built panamax vessels built between 2000 and 2004 (the spin-off). The company was spun-off from Euroseas Ltd. on 30 May 2018. The results below refer to the above fleet for the periods presented. Historical comparative periods reflect the results of the carve-out operations of the six vessels that were contributed to the company.

Aristides Pittas, Chairman and CEO of EuroDry commented: “During the second quarter of 2018, we achieved a significant milestone in executing our strategy by completing the spin-off of EuroDry Ltd, a shipping company focused on high quality middle range dry bulk vessels. Three of these vessels were built by Euroseas Ltd. and fully equipped with eco features, while the remaining three vessels are high quality middle-age Panamaxes built in Japan, the workhorses of the dry bulk trade. We are pleased to note that our shareholders benefited from the spin-off by having the market value of their combined EuroDry and Euroseas holdings increase by more than 40% as a result of the spin-off. Still, Eurodry is trading at a more than 50% discount to NAV, something we believe will be corrected as the market comes to understand the value of this new pure bulk carrier play and compares it with its peers.

“We are optimistic about the prospects of the dry bulk markets as the orderbook is close to its lowest levels of the last 20 years and new regulations coming in effect in the near future will likely keep the supply of vessels in check; this will allow increases in demand to positively influence earnings and values. We believe it is still an opportune time to pursue growth either through individual vessel purchases or by consolidating with others who would like to become shareholders of a publicly listed dry bulk company. Along those lines, we have been evaluating opportunities to acquire new vessels and exploring merger possibilities with other fleets in accretive transactions. We expect that the profitability we are experiencing in Q2 will continue and even further improve in the next couple of quarters.”

Tasos Aslidis, Chief Financial Officer of EuroDry commented: “The results of the second quarter of 2018 reflect the improving levels of the dry bulk markets compared to the same period of 2017. Total daily vessel operating expenses, including management fees, general and administrative expenses but excluding dry docking costs, averaged US$6726 per vessel per day during the second quarter of 2018 as compared to US$5626 per vessel per day for the same quarter of last year, and US$6701 per vessel per day for the first half of 2018 as compared to US$5453 per vessel per day for the same period of 2017. This increase is mainly due to higher general and administrative expenses as a result of the cost of the spin-off of EuroDry.

“Adjusted EBITDA during the second quarter of 2018 was US$2.4 million vs US$1.4 million in the second quarter of last year. As of 30 June 2018, our outstanding debt (excluding the unamortised loan fees) was US$53.7 million vs restricted cash, unrestricted cash and amounts due from related companies of US$9.7 million. As of the same date, our scheduled debt repayments over the next 12 months amounted to about US$16.5 million (excluding the unamortised loan fees) and all our loan covenants are satisfied.”